Indian stock indexes fell on Monday following a raft of negative news in the banking and real estate sectors, with shares in Indiabulls Housing Finance Ltd falling 34%.

The broader NSE index Nifty ended 0.33% lower at 11,474.45, while the benchmark BSE Sensex closed down 0.40% at 38,667.33.

Yes Bank Ltd fell 15%, making it the top decliner on both indexes.

Indiabulls' shares tanked after reports of a court notice seeking a probe into the housing finance firm on allegations of siphoning of funds by its owners.

The company denied the allegations.

Shares in Lakshmi Vilas Bank Ltd, which is proposing to merge with Indiabulls, also fell, by nearly 5% after the Reserve Bank of India (RBI) imposed a so-called prompt corrective action on the bank.

The Nifty private bank index and the Nifty PSU bank index, which track state-owned banks, were down by 2.75% and 3.46% respectively.

News last week that the RBI had taken charge of one of the country’s top co-operative banks sparked renewed concerns about the health of India’s troubled banking sector.

Media reports on Monday said over two-thirds of the Punjab and Maharashtra Co-operative Bank’s loan book was exposed to debt-ridden real estate development firm Housing Development and Infrastructure Ltd.

A report by the Press Trust of India said the country’s real estate sector had slashed its ad spending by 50% due to a slowdown in demand and tight liquidity.

“Any stock that is having exposure to real estate has corrected today,” said AK Prabhakar, head of research at IDBI Capital in Mumbai.

Yes Bank said its outstanding exposure to the “housing finance/real estate conglomerate, which is in the news today” was fully secured, in an apparent reference to Indiabulls.

That exposure had fallen about 30% over the last six months, Yes Bank added.